New York preacher uses 9/11 and Katrina funds for personal gain

New York
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September 11, 2001 and Hurricane Katrina changed the lives of many, including Rev. Carl Keyes, pastor of a little-known small church in New York City, whose fortunes changed to the tune of several millions of dollars.

NPR states donations amounting to $2.5 million was received by Keyes's charity to help 9/11 victims. An additional $2.3 million was donated for relief efforts in the hurricane-ravaged Gulf Coast area, as well as efforts to help the poorest area of West Virginia and Tennessee, and remote villages in Africa. KWQC says tens of millions of additional money was raised from the sale of church properties.

The events of 9/11 and the devastation left in the wake of Hurricane Katrina had transformed the pastor from an obscure small church preacher into a renowned humanitarian. According to Rev. Carl Keyes blogspot page, Keyes "is an internationally recognized humanitarian and founder of several non-profit organizations who has orchestrated some of the most significant emergency relief efforts in the history of the United States. Colin Powell, US Senate and the President of the United States formally recognized his first response efforts after the World Trade Center attacks and Hurricane Katrina as Carl Keyes' efforts were inserted into the Congressional Record of the United States."

However, the AP reports financial records, internal correspondence and interviews with former employees shows that Keyes often times used the donated funds for his personal finances. The report cites the follow examples:

- Keyes diverted large sums donated for 9/11 and Hurricane Katrina into his cash-starved church, then used charity and church money to pay hundreds of thousands of dollars in personal credit card bills and other debts, documents show.

- He failed for years to file required federal and state reports showing how much money his charities received and spent.

- He used large church donations from a wealthy supporter to pay his sons' private college tuition.

- The minister used a big donation meant for one of his charities to clear a mortgage on his family's house, according to an accountant who told Keyes he was quitting, in part because of the transaction.

- And, when his congregation sold its 19th-century church in midtown Manhattan for $31 million, he and his friends benefited.

In 2008, Keyes' congregation reported having $13.8 million in cash left from the sale of the Manhattan church after it paid off previous debts and bought a new building to for the church. In 2011 however, the congregation told a court it need to sell the purchased building because only $180,486 remained in its bank account.

The AP report states that records show $950,000 of the proceeds from the sale of old church was used to buy his family a country home near the Delaware River in New Jersey. Another $1 million went to support one of his charities, which "spent more on failed, lavish fundraisers than on promised programs in Africa."

Bruce Kowal, a former accountant for Keyes charities, filed complaints in 2008 with New York state tax officials. The complaint stated: "Not only was this (nonprofit) plundered to fund the operating deficits of the church, the amounts were spent on personal items of the pastor's family, and thus were items of taxable income."

Kowal backed up his accusation by attaching bank records to the complaint he says showed Urban Life Ministries paid some of Keyes' personal expenses, including his American Express bills, $349.23 a month for a leased on a car for sons, a $130 monthly payment on a storage unit near the private school the sons were attending and payments toward the personal loan Keyes owed on a Poconos property.

When questioned about the accusations, Keyes referred all questions to his lawyer, Jennifer Polovetsky. Polovetsky said all payments by his church and charities were proper and told the AP via email: "Sorry that you don't have a real `story' here, but the truth is actually quite boring since no one did anything wrong."

It is unclear at this time whether any charges will be brought against Keyes.